World stocks lower ahead of EU summit conclusion

PAMELA SAMPSON, AP Business Writer

Friday, 19 Oct 2012 | 5:09 AM ETThe Associated Press

SHARES

BANGKOK -- World stock markets fell Friday as disappointing U.S. corporate earnings provided a reason to book profits on recent gains while investors waited for a progress report from European leaders concluding a summit on the region's debt crisis.

Britain's FTSE 100 lost 0.1 percent to 5,910.04 in early trading. Germany's DAX was 0.4 percent lower to 7,411.65 and France's CAC-40 lost 0.3 percent at 3,523.74.

"It is one of those situations where we've had such a big run this week, we are at a stage where investors would be nervous to add onto positions or get fresh entries," said Stan Shamu, market strategist at IG Markets in Melbourne, Australia.

Worse-than-expected U.S. earnings on Thursday were a negative for markets. Microsoft said net income fell a worse-than-expected 22 percent to $4.47 billion in the fiscal first quarter, which ended Sept. 30. Microsoft shares fell in after-hours trading.

BB&T bank, Philip Morris International and Boston Scientific also reported results that fell short of forecasts.

Shares of Internet search trailblazer Google were pummeled after third quarter earnings were released three hours too early by mistake. The results alarmed investors because the company's earnings and revenue fell well below analyst projections. Google's stock price dropped 8 percent, causing $20 billion in shareholder wealth to evaporate.

Investors are also looking for more progress from a European summit convened to hash out solutions to the region's debt crisis.

European Union leaders took a crucial step on the opening day of a meeting in Brussels on Thursday by agreeing to create a banking supervisor to oversee institutions in the 17 countries using the euro. The summit concludes Friday.

Among individual stocks, electronics maker NEC surged 10.5 percent in Tokyo after the Nikkei business daily reported that the company will likely report a sixfold increase in operating profit for the April-September period, beating forecasts.

Benchmark oil for November delivery was down 16 cents to $91.94 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 2 cents to finish at $92.10 a barrel on Thursday.

In currencies, the euro fell to $1.3051 from $1.3061 late Thursday in New York. The dollar rose to 79.31 yen from 79.23 yen.